The losses of USD/CAD about 1.35 have been verified before the Bank of Canada (BoC) policy decision. Scotiabank economists expect the pair to fall below the 1.35 mark in the event of an interest rate hike.
A moderate rise would take USD/CAD to 1.38/1.39.
“Assuming a 75 bps hike, a moderate hike – ie 75 bps with a bias towards slower/limited hikes going forward and the rate cycle near its peak – will hurt the CAD and bring the pair back to get closer to 1.38/1.39”.
“A neutral rally -75 bps with little to no guidance – is likely to keep USD/CAD in its current range.”
“From the aggressive line, 75 basis points and clear indications in the statement that there is still a lot to do to curb inflation, cash should be below 1.35.”
Source: Fx Street
With 6 years of experience, I bring to the table captivating and informative writing in the world news category. My expertise covers a range of industries, including tourism, technology, forex and stocks. From brief social media posts to in-depth articles, I am dedicated to creating compelling content for various platforms.
